Under the FLSA and part 779 of title 29 of the CFR, would discretionary bonuses count towards exemption status?

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Under the FLSA and part 779 of title 29 of the CFR, would discretionary bonuses count towards exemption status?

In order for an employee to be considered exempt from overtime at a retail establishment they need to derive over half of their income from commission. However, do

Asked on July 10, 2019 under Employment Labor Law, Delaware

Answers:

SJZ, Member, New York Bar / FreeAdvice Contributing Attorney

Answered 1 year ago | Contributor

No, a discretionary bonus would not count towards the threshold. I non-discretionary bonus would IF it in fact was based on the same criteria as a commission--that is, sales--and so is actually a commission by another name; the law looks to the underlying reality, not the label applied. A bonus needs to functionally be a commission for this purpose.


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